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How Does Usage-Based Insurance Work?

Traditional car insurance premiums use a variety of factors including statistics based on aggregated driving records to calculate prices. Usage-Based Insurance, or UBI, is a type of car insurance that rates based on actual driving behavior.

On the other hand, usage-based insurance makes the price you pay for insurance more reflective of your actual driving behavior by measuring your driving habits.

When you sign up for a UBI program, like MAPFRE’s MotionSmartSM, you may receive an initial discount at initial enrollment. After the insurance company has collected data on your driver behavior for a certain length of time, the premium applied to your policy usually takes into consideration your safe driving habits.

Telematics Devices

In order to accurately identify and monitor a driver’s behavior, UBI programs rely on data from telematics devices or smartphone apps. Depending on the specific use-based insurance program, the insurance company may track your driving habits using:

  • Your car’s built-in telematics system
  • A plug-in device
  • A tag that sometimes pairs with a smartphone
  • A smartphone app

UBI Data Collection

In most cases, these devices transmit real-time data back to the insurance company. This might include data gathered from the position and inertial sensors that measures driving quality based on:

  • Hard acceleration
  • Hard braking
  • Hard cornering
  • Speeding
  • Phone usage while driving

This helps the insurance company calculate a more personalized price for car insurance or a more accurate discount to help you save more.

Use-Based Insurance Privacy Concerns

The type of data each company may collect and analyze varies. In the case of MAPFRE’s Massachusetts UBI program, MotionSmart, this data is used to measure your driving and make suggestions that ultimately promote safer driving. It’s also used to calculate a premium that takes into consideration your actual driving behavior.

MAPFRE isn’t interested in where you go, only how safely you get there. Your personal information and individually collected data is confidential. If you have questions about what data is collected and who has access to it, you can review the MotionSmart Privacy Policy.

MAPFRE’s MotionSmartSM

Getting the right car insurance coverage at an affordable price is important. Beyond annual mileage and safe driving car insurance discounts, MAPFRE now offers MotionSmartSM.

MotionSmartSM is a usage-based insurance program in Massachusetts where you receive a participation discount when each of the drivers on your policy registers in-app and starts driving. Additional savings are available at renewal based on how safely you drive during the policy term. To see if you could be saving on your Massachusetts car insurance with MotionSmartSM, get a quote online. If you have questions about MotionSmart or MAPFRE Insurance, contact a Massachusetts independent insurance agent closest to you.

Please Note: This article is meant only to provide general information about commonly available insurance coverages. Except as expressly noted, this content is not intended to describe any specific coverage offered by MAPFRE Insurance.  No coverage is provided, bound or guaranteed by this article.  Available coverages, credits and discounts vary from state to state and are subject to eligibility criteria and policy terms/conditions, which will control in the event of conflict between this article and your insurance policy. For information about your policy, please review your individual policy contract and speak with your insurance representative.

MAPFRE Insurance® is a brand and service mark of MAPFRE U.S.A. Corp. and its affiliates, including American Commerce Insurance CompanySM (Cal. COA 4928-8), Citation Insurance CompanySM, The Commerce Insurance CompanySM, Commerce West Insurance CompanySM (Cal. COA 1372-2), MAPFRE Insurance CompanySM (Cal. COA 3039-5), and MAPFRE Insurance Company of FloridaSM.

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